Daniel Pipes: Obama's Mansion, Saddam's Money

[Mr. Pipes (www.DanielPipes.org) is director of the Middle East Forum and Taube distinguished visiting fellow at the Hoover Institution of Stanford University.]

Barack Obama appears to have personally benefited from funds originating in Saddam Hussein's regime. It's a complicated connection, but one that deserves the consideration of Americans voters.

Two similar figures, Nadhmi Auchi and Antoin S. "Tony" Rezko, served as the intermediaries. Both are Middle Eastern males of Catholic Christian heritage who left Baathist dictatorships for Western cities (Auchi from Iraq to London, Rezko from Syria to Chicago). Both became successful businessmen who hobnobbed with politicians and promoted Arab interests. Both have been convicted of taking kickbacks and both stand accused of other shady dealings.
Auchi, born in 1937, is the more successful. When young, he joined Saddam in the Baath Party. He founded his main financial instrument, the General Mediterranean Holding SA in 1979 – revealingly, while still in Iraq. A year later, he emigrated to the United Kingdom. GMHSA now describes itself as a diverse group of 120 companies with consolidated assets of over US$4.2 billion. The Sunday Times (London) recently estimated Auchi's personal wealth at £2.15 billion, making him the 27th richest person in Britain. He garnered many honors along the way.

On the dark side, a French court in 2003 convicted Auchi of taking kickbacks in the Elf Affair and handed down a suspended jail sentence and fine. One analyst, Hector Igbikiowubo, calls this "probably the biggest political and corporate sleaze scandal to hit a western democracy since World War II." Also in 2003, one of Auchi's firms was accused of taking part in a price-fixing cartel of prescription medicines. In 2004, a report by the Pentagon's International Armament and Technology Trade Directorate found "significant and credible evidence" that Auchi organized a conspiracy to offer bribes to win mobile telephone licenses in Iraq. He was barred from entering the United States in 2005.

Rezko, born in 1955, arrived in the United States in 1974 to study civil engineering. After some work on road construction projects, he went into the fast-food business, then into real estate, with help from Auchi. His political involvement began in 1983 with a mayoral campaign, after which he acquired a taste for cultivating up-and-coming politicians, notably Obama and the current governor of Illinois, Rod Blagojevich.
Rezko too has extensive legal problems, starting with a June 2008 conviction on sixteen counts of taking kickbacks from companies wanting to do business with the State of Illinois. He also stands accused of evading Las Vegas gambling debts and using false information in the sale of his pizza businesses. In contrast to Auchi's wealth, Rezko is said to be over $50 million in debt.

In three steps, these corrupt businessmen tie the Democratic Party presidential candidate to the executed Iraqi tyrant:

Saddam Hussein made use of Auchi: Auchi's fortune largely grew through his Iraq government connection, much of it sub rosa. In the 1980s, he procured Italian military ships. By 1993, the Italian banker Pierfrancesco Pacini Battaglia testified about Auchi bribing Iraqi officials for an Italian engineering company and called Auchi "one of the most important intermediaries in the affairs of Middle Eastern countries." Auchi is also a major shareholder in BNP Paribas, the French bank deeply implicated in the U.N.'s corrupt Iraq oil-for-food program.

Auchi made use of Rezko: Rezko lobbied for Auchi to be allowed into the United States. A wholly-owned GMHSA subsidiary, Fintrade Services Inc., transferred a loan of $3.5 million on May 23, 2005 to Rezko.

Rezko cultivated Obama: Rezko offered Barack Obama a job in 1990, which Obama declined. Still, Rezko persisted, hiring him for legal work and hosting in 2003 an early fundraiser that, writes David Mendell in Obama: From Promise to Power, proved "instrumental in providing Obama with seed money" for his nascent U.S. Senate campaign. Then, on June 15, 2005, just twenty-three days after receiving Auchi's $3.5 million, Rezko partnered with Obama in a real estate deal: while Rezko's wife paid the full asking price, $625,000, for an empty adjoining lot which they then improved, subdivided, and partially sold to Obama, Obama acquired a mansion for $1.65 million, $300,000 under the asking price.

Summing up: Barack Obama's house purchase depended on favors from Rezko, flush with a "loan" from Auchi, whose fortune derived in part from Saddam Hussein's favor.

When seen in the context of Obama's other dubious connections (Ayers, Davidson, Wright, Khalidi, et al.), this network is all the more alarming.

More Comments:

Leslie Kitchen -
11/28/2008

In describing the Freeport Doctrine of Stephen A. Douglas, Lincoln remarked that it was "...as thin as the homeopathic soup that was made by boiling the shadow of a pigeon that had starved to death." That pigeon's shadow is fat and heavy compared to the logic of this piece. What are we to make of this anti-contextual, counterfactual, intellectually dishonest manipulation of hotly imagined "facts?"

Even if we should be so extravagantly generous as to, for the sake of argument, say any of this is so (and to do so might raise a stench in the nostrils of God), where is the intent on the part of Saddam Hussein to fund Barrack Obama? Where is the intent on the part of Obama to benefit and live high by nefariously glomming on to the dirty cash of a dictator?

Rezko was known to Obama and countless other Chicagoans as a mainstream American businessman. That Rezko was later revealed to be corrupt, and to smear Obama with that, is a queer and tortured form of wish-led ex post facto illogic.

How dare Barrack Obama attempt to acquire a comfortable home for himself and his family in a locale of his own choosing! How unAmerican!

Pipes has cried fire in a theater. Hussein!, he cries, in his frantic attempts at making Legoland connections that exist only in his own mind. The trashiness, dishonesty, and intellectual lack of discipline reflected in making Obama a beneficiary of Saddam Hussein can only throw us back to Shakespeare: "...man, proud man..plays such tricks before high heaven as make the angels weep." While those angels are weeping, Mr. Pipes makes this writer blush for being human.